By Michael Inman and Meredith Clisby

3 July 2015 — 7:35pm

The construction union has asked three government bodies to investigate sham contracting, tax dodging, and phoenixing in the ACT formwork industry.

CFMEU ACT branch secretary Dean Hall on Friday wrote to the Fair Work Ombudsman, Australian Tax Office and the Australian Securities and Investments Commission to urge them to intervene in the conduct he alleges is common in the territory.

The letter coincided with a demonstration outside the ACT CFMEU's Dickson offices, where some union members tore up their membership cards.

An estimated 50 workers from about eight formwork companies protested on Friday over allegations the CFMEU had attempted to force workers onto a union enterprise agreement.

The Master Builders Association of the ACT's executive director, Kirk Coningham, said: "Our members reported that union officials had been on sites over the past two weeks telling these small businesses that they were no longer allowed to work in the ACT and that their workers had to apply for jobs with larger formwork operators with union EBAs."

He said a law-abiding business should be left to succeed or fail based on the value it brought to clients and should never be dependent on the whims of an outside entity with its own commercial interests.

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"Even more importantly, these workers should be allowed to choose who they want to work for, not be told who they must work for," Mr Coningham said.

But the CFMEU said formwork workers had been put at risk through their employer's failure to comply with enterprise agreements and sham contracting.

The union also alleges some companies made cash payments to workers and had phoenixed to avoid paying creditors.

ACT branch secretary Dean Hall wrote to the three government bodies to urge them to intervene.

Mr Hall said he made the call for an investigation after an employee of a formwork company, which had contracted to provide labour for an ACT company, was injured on a Wright construction site this year.

The union says the man was admitted to hospital after he was struck by an unfastened shutter that fell over in the wind, and is yet to return to work.

The union claims an investigation discovered the man had been underpaid and not provided entitlements, such as penalty rates or allowances.

Mr Hall said the situation failed to comply with enterprise agreements and he had concerns the arrangement was sham contracting.

"The effect of the failure to record his actual wages now has a devastating effect … as his workers compensation entitlements are only paid on the basis of what was recorded on his payslips (not the amount he was due under the agreement or the cash amount), he was denied proper superannuation payments and other ancillary entitlements (annual leave and sick leave at the correct rate)," Mr Hall wrote.

"Unfortunately the case … is not rare. It is all too common.

"It is for this reason that we are now writing to you so as to ask you to co-ordinate a whole-of-government approach to the issues raised in the formwork sector within the ACT."

Mr Hall also urged the FWO and ASIC to probe a series of companies in the sector that had collapsed only to resurface with the same directors under a new name soon after.

He argued companies that phoenix robbed creditors of their money and entitlements, including the tax office.

The letter also asked the tax office to ensure superannuation in the formwork sector had been paid and was up to date.

"The issue of phoenix companies and the trail of destruction they leave behind is a significant issue in the construction sector," Mr Hall wrote.

"Many of our members are denied [superannuation] … when a company goes into administration.

"In addition, the union has anecdotal evidence to suggest that the incidence of cash payments in the formwork supplementary sector is high."